PORT KLANG: Port Klang Authority (PKA) plans to construct a cargo port estimated to cost RM28 billion on Carey Island, Klang, scheduled to be completed by 2060, said PKA general manager Capt. K. Subramaniam (pic).
Additionally, PKA is looking into developing a back-up area for the existing port, which is also known as a special economic zone which will serve as a base for manufacturing activities and other value-added logistics services.
Based on the studies, he told SunBiz, the cost of development is estimated at RM28 billion, which will largely go towards terminal infrastructure, especially the construction of the berths and the provisioning of equipment for operations, roads and utilities including digital connectivity, power and water supply.
Before construction begins, he said, there will be a lot of investments and efforts going towards land reclamation and dredging including the construction of a breakwater.
Looking at the geographical location of Carey Island, the new port – which will be adjacent to Westports and located offshore– will face the open sea and weather elements are going to be stronger in those areas.
“Once offshore, away from the current port, the waves are higher, the winds are stronger and to operate a port like this, a container port, you have to have calm waters. Hence the best defence is to build a breakwater for protection to keep the waves away from the harbour area, so there’s going to be some considerable investment needed for breakwater as well,” Subramaniam said.
He cited the existing terminals of Northport and Westports, which are quite well-sheltered from natural elements by off-lying islands and did not require such breakwater facilities.
The port development on Carey Island will be spaced over 35 years and PKA aims to get started by 2025, but noted that there will be challenges along the way, before the port starts operating.
“We need to reclaim land and dredge the waters before construction can begin, all this will take about four to five years. Our plan is to complete the preliminary preparations by 2025. We have a fair idea of what sort of development plan we are going to have, the potential development partners, the type of operations and the technology that is to be adopted,” said Subramaniam.
He said that there is no rush to develop the new facility on Carey Island as Westports Phase 2 will begin soon, and is estimated to be fully operational in 10 to 12 years’ time. However, he reckoned that by the time Westports Phase 2 is completed, the Carey Island project will be ready to take off.
Subramaniam said the Carey Island development will be carried out in four phases – Phase 1A (2025-2030), Phase 1B (2030-2040), Phase 2 (2040-2050) and Phase 3 (2050-2060).
Initially, conventional berths will be built, which will handle conventional cargo comprising liquid bulk, dry bulk, project cargo and general cargo.
“The conventional berths will be developed under Phase 1A, thereafter we will start building the 1st phase of container facilities with a capacity of 10 million TEUs (twenty-foot equivalent units), from 2030-2040. The second Phase of another 10 million TEUs will be between from 2040 to 2050 and finally phase will be from 2050 to 2060 with the addition of the final 10 million TEUs.
“When we complete the four phases, we will have a total wharf length of about 16km, with a capacity to handle in Carey Island alone, 30 million TEUs and another 20 million tonnes for conventional cargo,” Subramaniam said.
In terms of operators or partners, PKA has yet to finalise any parties but has identified several potential players for joint development. Currently discussions are ongoing with landowners on Carey Island to see how they can be part of the development. The final decision on the business and development model and project partner will be the prerogative of the Ministry of Transport and the government.
Subramaniam did not discount the participation of existing port operators in Malaysia to undertake the Carey Island development. He pointed out that the country has notable port operators such as MMC, Westports and IJM which operates Kuantan Port.
However, he said, PKA is not limiting its options to just Malaysian port operators, and is open to international partners. He remarked that PKA will be “coming out with a model that is the best for the country”, which is viable and sustainable over the long-term.
“We have many international port operating companies who have expanded around the globe given the international nature of port and shipping operations. “We will be talking to shipping lines as well, there are a number of shipping lines which are operating their own terminals including Cosco and Maersk – respectively operating Cosco Terminals and AP Moller terminals in several countries around the world,” he said.
Meanwhile, a source has revealed that Westports is still in the midst of working with the relevant authorities to conclude its expansion plan but cannot disclose details as they are confidential. Nonetheless, the source said the company hopes that it can finalise the discussion sometime this year and will make an announcement, once an agreement has been signed.
The source added that the expansion of Westports, particularly Container Terminal 10 to 17, will increase Westports’ handling capacity from the current 14 million TEUs to 28 million TEUs.
It is learnt that the company handled 10 million TEUs last year. Subject to the international trade and volume growth moving forward, the company’s expansion plan should be able to provide it with the additional handling capacity to cater to demand and volume growth for the next 30 years.